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OBI Pharma, Inc. v. Does

United States District Court, S.D. California

April 27, 2017

OBI PHARMA, INC., a Taiwanese Corporation, Plaintiff,
v.
DOES 1-20, inclusive, Defendants.

          ORDER GRANTING EX PARTE MOTION FOR EARLY DISCOVERY AND MOTION TO FILE DOCUMENTS UNDER SEAL [ECF No. 6, 12]

          Hon. Bernard G. Skomal United States Magistrate Judge

         Plaintiff OBI Pharma, Inc. filed an Ex Parte Motion seeking early discovery to serve a subpoena on inspire.com to identify individuals that anonymously posted negative statements about Plaintiff on the inspire.com website. (ECF No. 6.)

         The Court ordered Plaintiff to file supplemental briefing addressing the nature of the speech at issue, the applicable standard given the nature of the speech, and any evidence in support.[1] (ECF No. 7.) Following two requests for extensions of time, (ECF Nos. 8, 10), Plaintiff filed its Supplemental Brief. (ECF No. 14.) Based on the analysis below, the Court GRANTS the Motion.

         BACKGROUND

         Plaintiff's Complaint asserts claims for Trade Libel, Libel Per Se, and Intentional Interference with Prospective Economic Advantage. (Compl. ¶¶ 17-41.) Plaintiff alleges that Doe Defendants made deliberately false statements on a website to defame Plaintiff, scare patients involved in Plaintiff's clinical trials to drop out of the trials to make it impossible for Plaintiff to obtain approval of its products by the Federal Drug Administration (“FDA”), and destroy investor confidence in Plaintiff's business. (Compl. ¶¶ 1, 23.) Plaintiff alleges the Doe Defendants posted false information about Plaintiff and its product on inspire.com, a website that provides information regarding potential treatments and drugs for medical conditions such as cancer. (Id. at ¶ 13.) The Complaint asserts the statements were made under the pseudonyms “O8I” or “OBLie” and that the statements were misleading, inaccurate, unfounded, false, and accused Plaintiff, by name, of criminal and unethical acts. (Id. at ¶¶ 14, 28.) False, misleading, and inaccurate statements were made regarding one product by name. (Id. at ¶ 29.) Plaintiff alleges that as a result of the postings patients and individuals stopped participating in the trials or chose not to participate in the trials, impacting its ability to obtain FDA approval of the product. (Id. at ¶¶ 22, 34, 41.) The Complaint also alleges the statements have resulted in lost capital investments, sale of Plaintiff's stock, and business prospects it would have otherwise engaged in. (Id. at ¶¶ 26, 35.) Neither the Complaint nor the Motion provided the statements. However, Plaintiff has now provided the statements with its Motion to File Portions of Supplemental Brief and Supporting Evidence Under Seal. (ECF No. 12.)

         DISCUSSION

         I. Standards

         The Ninth Circuit has not identified one specific test that applies anytime a party seeks the identity of an anonymous online poster through discovery. However, the court has made clear that in such cases, “the nature of the speech should be a driving force in choosing a standard” and the Court must consider[] the important value of anonymous speech balanced against a party's need for relevant discovery in a civil action.” In re Anonymous Online Speakers, 661 F.3d 1168, 1176 (9th Cir. 2011); Marvix Photographs, LLC v. LiveJournal, Inc., 2017 WL 1289967, at * 10 (9th Cir. April 7, 2017) (citing Anonymous Online Speakers, 661 F.3d at 1176 and explaining courts must apply a balancing test to “determin[e] whether First Amendment protections for anonymous speech outweigh the need for discovery”); see also S103, Inc. v. Bodybuilding.com LLC, 441 Fed.Appx. 431 (9th Cir. 2011) (vacating and remanding for district court to determine the nature of the speech as was necessary to determine which standard to apply to it).

         The Anonymous Online Speakers court identified and summarized the tests used by lower courts and the types of speech they have been applied to. 661 F.3d at 1175-76. These tests are used “to benchmark whether an anonymous speaker's identity should be revealed.” Id. at 1175. In each, “the initial burden rests on the party seeking discovery and requires varying degrees of proof of the underlying claim.” Id. at 1176.[2] Two of the standards require some evidentiary basis for the claims asserted. See Art of Living Found. v. Does 1-10, 10-CV-5022-LHK, 2011 WL 5444622, at *4 (Nov. 9, 2011) (citing Highfields Capital Mgmt., L.P. v. Doe, 385 F.Supp.2d 969, 975 (N.D. Cal. 2005) and Doe v. Cahill, 884 A.2d 451 (Del. 2005)).

         The motion to dismiss or good faith standard is “the lowest bar that courts have used” to evaluate whether the anonymous speaker's identity should be disclosed. Anonymous Online Speakers, 661 F.3d at 1175 (citing Columbia Ins. Co. v. seescandy.com, 185 F.R.D 573 (N.D. 1999) and In re Subpoena Duces Tecum to America Online, Inc., No. 40570, 2000 WL 1210372 (Va. Cir. Ct. Jan. 31, 2000) (reversed on other grounds)).

         A higher standard, applied when a subpoena sought the identify of an anonymous poster that was not a party to the case, indicated identification was “only appropriate where the compelling need for discovery . . . outweigh[ed] the First Amendment right of the speakers because litigation [could] continue without disclosure of the speakers' identities.” Id. at 1176 (discussing Doe v. 2TheMart.com, 140 F.Supp.2d 1088, (W.D. Wash. 2001) and citing Sedersten v. Taylor, No. 09-3013-CV-S-GAF, 2009 WL 4802567 (W.D. Mo. Dec. 9, 2009) and Enterline v. Pocono Med. Ctr., 3:08-CV-1934, 2008 WL 5192386 (M.D. Pa. Dec. 11, 2008)).

         The prima facie standard requires “plaintiffs to make at least a prima facie showing of the claim for which the plaintiff seeks the disclosure of the anonymous speaker's identity.” Anonymous Online Speakers, 661 F.3d at 1175 (citing Doe I v. Individuals, 561 F.Supp.2d 249 (D. Conn. 2008), Highfields, 385 F.Supp.2d 969; Sony Music Entm't, Inc. v. Does 1-40, 326 F.Supp.2d 556 (S.D.N.Y. 2004). Often referred to as the Highfield standard, courts have applied it when the speech at issue “falls somewhere beneath the most protected realm of ‘political, religious, or literary discourse; is in significant part, ‘commercial speech' that enjoys ‘lesser' protection; but may be more safeguarded than pure ‘fighting words and obscenity' which is not protected by the First Amendment at all.'” Music Grp. Macao Commercial Offshore Ltd. v. Does, 82 F.Supp.3d 979, 983 (N.D. Cal. 2015) (quoting Anonymous Online Speakers, 661 F.3d at 1173, 1175-76).

         The “most exacting standard, established by the Delaware Supreme Court in Doe v. Cahill, . . . requires plaintiffs to be able to survive a hypothetical motion for summary judgment and give, or attempt to give, notice to the speaker before discovering the anonymous speaker's identity.” Id. at 1176 (citing Doe v. Cahill, 884 A.2d 451 (Del. 2005)). This standard requires the submission of evidence sufficient “to establish a prima facie case for each essential element of” the plaintiff's claim. Id. at 1176 (quoting Cahill, 884 A.2d at 463). Cahill itself involved political speech and appears to be reserved for “political, religious, or literary speech.” See Id. at 1176-77 (finding Cahill “extends too far” in being applied when the speech involved commercial contracts and noting commercial speech should be afforded less protection.); see also Music Grp., 82 F.Supp.3d at 983.

         II. ...


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